Gramercy Property Trust (NYSE:GPT) today reported financial
results for the full year and the fourth quarter of 2016.
Operating Results:
($ in thousands, except per share
data) Three Months Ended Twelve Months Ended
December 31, December 31, 2016
2015 2016 2015 Net income (loss)
to common shareholders $ 4,769 $ (51,215 ) $ 27,124 $ (54,162 ) Net
income (loss) per common share1 $ 0.03 $ (0.70 ) $ 0.19 $ (0.89 )
FFO available to common shareholders and unitholders $
69,118 $ (22,522 ) $ 274,509 $ 42,136 FFO per common share1 $ 0.49
$ (0.30 ) $ 1.93 $ 0.67 Core FFO available to common
shareholders and unitholders $ 72,264 $ 36,998 $ 314,361 $ 115,361
Core FFO per common share1 $ 0.51 $ 0.50 $ 2.21 $ 1.85 AFFO
available to common shareholders and unitholders $ 68,881 $ 34,618
$ 288,572 $ 101,279 AFFO per common share1 $ 0.48 $ 0.46 $ 2.03 $
1.62 1. All share and per share amounts in this press
release are presented on a diluted basis and are adjusted for the
1-for-3 reverse share split completed on December 30, 2016.
Fourth Quarter 2016
Highlights
- Acquired 29 properties in twelve
separate transactions for an aggregate purchase price of
approximately $718.5 million (6.5% initial cash cap rate; 6.9%
annualized straight-line cap rate) with a weighted average
remaining lease of approximately 6.4 years at closing.
- Disposed of four single-tenant office
buildings: three in the U.S. for aggregate gross proceeds of $106.3
million and one in Coventry, United Kingdom for £9.0 million.
Additionally, the Company's 80% joint venture disposed of one
single-tenant industrial asset in Rugby, United Kingdom for pro
rata gross proceeds of £12.0 million. The weighted average
remaining lease term for the five sold properties was 7.7 years at
closing and the blended exit cap rate was 6.3% on next twelve
months NOI.
- Completed a 1-for-3 reverse share split
of the Company's common shares and its outstanding units on
December 30, 2016.
- Provided fiscal year 2017 earnings
guidance, as follows:
- Core FFO of $2.10 - $2.25 per diluted
common share
- AFFO of $1.95 - $2.10 per diluted
common share
- Launched an “at-the-market” equity
issuance program in January 2017, pursuant to which the Company may
offer and sell common shares with an aggregate gross sales price of
up to $375.0 million.
- Entered into an agreement to wind-up
the asset management agreement with KBS at the end of the first
quarter of 2017. The Company will earn asset management fees plus
the potential for incremental incentive fees through the end of the
arrangement.
- Subsequent to quarter-end, declared a
first quarter 2017 common share dividend of $0.375 per share.
Summary
Gramercy Property Trust (NYSE:GPT) today reported net income to
common shareholders of $4.8 million, or $0.03 per diluted common
share, for the three months ended December 31, 2016, and net
income to common shareholders of $27.1 million, or $0.19 per
diluted common share for the full year ended December 31,
2016. Net income for the three months ended December 31, 2016
includes $3.5 million of other income attributable to the reversal
of an accrual for a tenant audit which was settled for a lower
amount than originally estimated. Net income was reduced by $2.7
million, of which $10.1 million is reported as impairment of real
estate investments, and is offset by gains of $5.5 million in
equity of net income (loss) of unconsolidated investments, $409
thousand of gains in discontinued operations, and $1.5 million of
net gains on disposals.
For the quarter, the Company generated NAREIT defined FFO of
$69.1 million, or $0.49 per diluted common share, and for the year
ended December 31, 2016, FFO was $274.5 million, or $1.93 per
diluted common share. The Company also reported Core FFO of $72.3
million, or $0.51 per diluted common share during the quarter, and
for the year ended December 31, 2016, Core FFO was $314.4
million, or $2.21 per diluted common share. The Company generated
adjusted funds from operations, or AFFO, of $68.9 million, or $0.48
per diluted common share during the quarter, and for the year
ended December 31, 2016, AFFO was $288.6 million, or $2.03 per
diluted common share. A reconciliation of FFO, Core FFO and AFFO to
net income available to common shareholders is included in this
press release.
For the fourth quarter of 2016, the Company recognized total
revenues of $126.2 million compared to $131.1 million reported in
the prior quarter. The decrease of $4.9 million, or 3.7%, is
primarily attributable to $4.5 million of additional amortization
of below market lease intangibles in the third quarter of 2016.
The Company reaffirms its previously announced outlook for 2017
with expected Core FFO of $2.10 - $2.25 per diluted common share
and expected AFFO of $1.95 - $2.10 per diluted common share. This
outlook assumes acquisition of properties of $400.0 million to $1.0
billion and disposition of properties of $200.0 million to $400.0
million and assumes zero to $400.0 million in equity raised.
As of December 31, 2016, the Company owned interests in 318
properties containing an aggregate of approximately 65.0 million
rentable square feet with 98.5% occupancy and an ABR weighted
average remaining lease term of 7.6 years.
Property Acquisitions
In the fourth quarter of 2016, the Company acquired 29
industrial properties in twelve separate transactions for an
aggregate purchase price of approximately $718.5 million (6.5%
initial cap rate; 6.9% annualized straight-line cap rate) with a
weighted average remaining lease term of approximately 6.4 years at
closing.
With these acquisitions, the Company acquired approximately $1.4
billion of single and multi-tenant assets in the United States and
Canada in 2016. The weighted average entry cap rate for these
acquisitions is 6.8%. Currently, the Company has approximately
$130.0 million in acquisitions under contract or under signed
LOI.
Fourth quarter 2016 property acquisitions are summarized in the
chart below:
(Dollar amount in thousands)
Acq. Date
Location MSA
Property Type
RentableSquareFeet
PurchasePrice
Occupancy
Acq.Cash NOI
S/L NOI 10/3/2016
Anaheim, CA Los Angeles
Industrial 64,846 $ 9,000
100.0% $ 507
$ 550 10/5/2016 Naperville, IL Chicago Industrial
440,343 33,600 100.0% 2,134 2,520 10/6/2016 Henderson, NV Las Vegas
Industrial 232,856 25,300 100.0% 1,394 1,606 10/11/2016 Black
Creek, GA Savannah Industrial 604,930 32,900 100.0% 2,221 2,374
10/13/2016 Montgomery, NY New York/New Jersey Industrial 118,335
23,775 100.0% 1,759 1,766 10/14/2016 Oakland, CA Bay Area
Industrial 66,913 12,300 100.0% 790 895 11/22/2016 Elkridge, MD
Baltimore/Washington Industrial 40,900 5,550 100.0% 391 433
11/29/2016 Commerce City, CO Denver Industrial 140,630 12,000
100.0% 773 831 12/9/2016 Swedesboro, NJ Philadelphia Industrial
197,500 15,350 100.0% 960 1,059 12/9/2016 West Chester, OH
Cincinnati Industrial 195,280 9,800 100.0% 666 735 12/15/2016
Jacksonville, FL Jacksonville Industrial 469,830 22,500 100.0%
1,784 1,821 12/15/2016 McDonough, GA Atlanta Industrial 676,000
26,700 100.0% 1,649 1,649 12/15/2016 Fairburn, GA Atlanta
Industrial 1,145,378 74,000 100.0% 4,088 4,346 12/15/2016
Summerville, SC Charleston Industrial 1,100,235 63,000 100.0% 3,770
4,195 12/15/2016 Southaven, MS Memphis Industrial 740,844 34,310
100.0% 2,156 2,401 12/15/2016 Southaven, MS Memphis Industrial
373,644 17,000 53.0% 497 677 12/15/2016 Memphis, TN Memphis
Industrial 829,464 33,250 100.0% 2,369 2,419 12/15/2016 Memphis, TN
Memphis Industrial 540,000 21,500 100.0% 1,459 1,474 12/15/2016
Plainfield, IN Indianapolis Industrial 804,586 35,200 100.0% 2,350
2,454 12/15/2016 Plainfield, IN1 Indianapolis Industrial 493,500
23,300 100.0% 1,873 1,886 12/15/2016 West Chester, OH Cincinnati
Industrial 479,512 20,230 100.0% 1,629 1,643 12/15/2016 West
Chester, OH Cincinnati Industrial 345,600 14,570 100.0% 1,064 1,086
12/15/2016 Walton, KY Cincinnati Industrial 603,586 30,000 100.0%
2,331 2,378 12/15/2016 Irving, TX Dallas Industrial 527,100 33,000
100.0% 1,919 1,946 12/15/2016 Fairfield, CA Bay Area Industrial
607,208 48,500 100.0% 2,830 3,368 12/15/2016 Woodland, CA
Sacramento Industrial 260,400 12,000 100.0% 969 1,004 12/15/2016
Woodland, CA Sacramento Industrial 260,400 11,500 100.0% 899 922
12/20/2016 York, PA Central PA Industrial 85,195 7,825 100.0% 577
617 12/28/2016 Alpharetta, GA Atlanta, GA Industrial 138,000 10,500
100.0% 672 738
Totals 12,583,015
$ 718,460 98.6% $ 46,480
$ 49,793 1. The Plainfield, IN
property's purchase price is reduced by $3.0 million that the
Company may owe at a later date based upon various leasing
contingencies negotiated between the Company and the seller of the
portfolio.
Property Dispositions
Pursuant to the Company's previously announced disposition plan,
during the quarter, the Company disposed of three single-tenant
office buildings in the U.S. for aggregate gross proceeds of $106.3
million and one single-tenant office building in Coventry, United
Kingdom for £9.0 million. The weighted average remaining lease term
for the four sold properties was 7.6 years at closing and the
blended exit cap rate was 6.8% on next twelve months NOI.
For the year ended December 31, 2016, the Company has sold
over $1.5 billion of single and multi-tenant assets in the United
States and Europe. These property sales are a part of the Company’s
previously announced plan to dispose of select non-core assets
following the merger with Chambers Street Properties. The weighted
average exit cap rate for these dispositions is 6.8% and reflects
the Company’s pro rata share of joint venture assets acquired and
sold. Subsequent to quarter end, the Company disposed of a single
tenant office building in Chantilly, VA for $25.3 million.
Currently, the Company has approximately $147.1 million of assets
under contract or in the market for sale.
Fourth quarter 2016 property dispositions are summarized in the
chart below:
Wholly Owned Dispositions (Dollar amount in thousands)
Disp. Date Location
MSA Property Type
RentableSquare Feet
SalePrice
Disp. CashNOI
11/7/2016 San Diego, CA
San Diego Office 132,685
$ 38,000 $ 2,234
11/18/2016 Lake Mary, FL Tampa/Orlando Office 108,499 20,000 1,726
11/21/2016 Las Colinas, TX Dallas Office 226,822 48,300 3,785
12/23/2016 Coventry, U.K.1 Europe Office 50,502 11,106 203
Totals 518,508 $ 117,406
$ 7,948 1. The asset located in
Coventry, United Kingdom assumes an exchange rate of 1.2340 USD per
GBP. NTM NOI for the Coventry asset includes the impact of free
rent.
European Joint Ventures
At December 31, 2016, the Company owns a 14.2% interest in the
Gramercy European Property Fund, an 80% interest in the Goodman
U.K. joint venture, and a 5.1% interest in the former Goodman
Europe joint venture (now 94.9% owned by the Gramercy European
Property Fund). Collectively these European joint ventures
aggregate $79.2 million of carrying value on the Company's balance
sheet.
During the fourth quarter of 2016, Gramercy Europe acquired one
property. Since inception, Gramercy Europe has acquired 34
properties for €660.0 million which includes the properties
previously part of the former Goodman Europe joint venture. The
Company received distributions of $5.3 million from the Company's
European joint venture in the fourth quarter of 2016.
The Company’s United Kingdom joint venture with Goodman Group,
or Goodman U.K. joint venture, disposed of a single-tenant
logistics building located in Rugby, United Kingdom for pro rata
gross proceeds of £12.0 million to the Company. Prior to the sale,
the joint venture extended the existing lease with a global
logistics provider. The Goodman U.K. joint venture has two
remaining warehouses that are currently being repositioned and are
expected to be disposed of in the first half of 2017.
Leasing Activity
During the fourth quarter of 2016, the Company executed seven
lease renewals aggregating approximately 1.7 million square feet
for an average lease term of 6.6 years. In addition, two new leases
and seven renewals commenced during the fourth quarter of 2016
aggregating approximately 2.0 million square feet for an average
lease term of 7.8 years.
Gramercy Asset
Management
The Company's asset and property management business, which
operates under the name Gramercy Asset Management, currently
manages approximately $1.2 billion of commercial properties for
third parties, including $875.0 million in Europe. In the fourth
quarter of 2016, the Company entered into an agreement to wind-up
the asset management agreement with KBS at the end of the first
quarter of 2017. The Company will earn asset management fees plus
the potential for incremental incentive fees through the end of the
arrangement.
In the fourth quarter of 2016, Gramercy Asset Management
recognized fee revenues of $5.2 million in property management,
asset management, and administrative fees, as compared to $7.2
million for the prior quarter. The decrease in fees of
approximately $2.0 million for the fourth quarter of 2016 is
primarily attributable to incremental incentive fees earned on the
managed portfolio during the third quarter of 2016. Gramercy Asset
Management recorded $1.0 million in incentive fees earned from the
Company's third-party asset management business for the fourth
quarter of 2016, compared to $2.9 million for the prior
quarter.
Corporate
As of December 31, 2016, the Company maintained
approximately $851.7 million of liquidity, as compared to
approximately $900.3 million of liquidity reported at the end of
the prior quarter. Liquidity includes $67.5 million of unrestricted
cash as compared to approximately $56.4 million reported at the end
of the prior quarter. During the quarter, the Company drew down
$230.0 million and repaid $327.5 million previously drawn on the
Senior Unsecured Revolving Credit Facility. As of December 31,
2016, there were $65.8 million of borrowings outstanding under the
revolving credit facility.
On December 30, 2016, the Company completed a 1-for-3 reverse
share split of the Company's common shares and its outstanding
units of GPT Operating Partnership LP, resulting in the reduction
of the outstanding common shares of beneficial interest from
approximately 422.0 million to approximately 140.6 million.
The Company completed the private placement of $350.0 million in
senior unsecured notes, consisting of $150.0 million of notes due
December 2022 having a fixed interest rate of 3.89%, $100.0 million
of notes due December 2025 having a fixed interest rate of 4.26%,
and $100.0 million of notes due December 2026 having a fixed
interest rate of 4.32%, resulting in a weighted average maturity of
8.0 years and a weighted average fixed interest rate of 4.12%. In
December 2016, the Company entered in to a fixed-pay swap on the
3-year $300.0 million term loan due January 2019, resulting in an
effective interest rate of 2.33%. With the swap, the Company’s
floating rate debt exposure was reduced to approximately 2.7% of
borrowings as of December 31, 2016.
During the fourth quarter of 2016, the Company also assumed
$198.2 million of mortgages secured by 16 of the 17 properties in
the $520.6 million logistics portfolio acquired.
General and administrative, or G&A, expenses were $9.3
million for the quarter ended December 31, 2016 compared to
$8.2 million in the prior quarter. G&A expenses included
non-cash share compensation costs of approximately $1.6 million for
the quarter ended December 31, 2016 compared to $1.3 million
in the prior quarter. The increase in G&A expenses of $1.1
million is primarily due to increased compensation costs.
Acquisition costs for the quarter ended December 31, 2016
included no merger-related costs compared to acquisition costs for
the quarter ended December 31, 2015, which included $47.4
million of merger-related costs.
Subsequent to quarter end, the Company launched an
“at-the-market” equity issuance program in January 2017, pursuant
to which the Company may offer and sell common shares with an
aggregate gross sales price of up to $375.0 million.
Dividends
The Company declared a dividend of $0.375 per common share for
the fourth quarter of 2016. The fourth quarter dividend was paid on
January 13, 2017 to holders of record as of December 30,
2016.
The Company also declared a fourth quarter 2016 dividend on the
Company’s 7.125% Series A Cumulative Redeemable Preferred Shares in
the amount of $0.44531 per share, which was paid on
December 30, 2016 to preferred shareholders of record as of
the close of business on January 13, 2017.
Subsequent to quarter end, the Company declared a first quarter
2017 common share dividend of $0.375 per share payable on April 14,
2017 to shareholders of record as of March 31, 2017.
Subsequent to quarter end, the Company also declared a first
quarter 2017 dividend on the Company's 7.125% Series A Cumulative
Redeemable Preferred Shares in the amount of $0.44531 per share,
payable on March 31, 2017 to preferred shareholders of record as of
the close of business on March 15, 2017.
Company Profile
Gramercy Property Trust is a leading global investor and asset
manager of commercial real estate. The Company specializes in
acquiring and managing high quality, income producing commercial
real estate leased to high quality tenants in major markets in the
United States and Europe.
To review the Company’s latest news releases and other corporate
documents, please visit the Company's website at www.gptreit.com or
contact Investor Relations at 888-686-0112.
Conference Call
The Company's executive management team will host a conference
call and audio webcast on Wednesday, March 1, 2017, at 11:00
AM EST to discuss 2016 full year and fourth quarter financial
results. Presentation materials will be posted prior to the call on
the Company's website, www.gptreit.com.
Interested parties may access the live call by dialing
1-888-317-6003, or for international participants 1-412-317-6061,
using passcode 9938859. Additionally, the live call will be webcast
in listen-only mode on the Company’s website at www.gptreit.com in
the Investor Relations section.
A replay of the call will be available at 2:00 PM EST, March 1,
2017 through midnight, March 15, 2017 by dialing 1-877-344-7529, or
for international participants 1-412-317-0088, using the access
code 10100663.
Disclaimer
Non GAAP Financial Measures
The Company has used non-GAAP financial measures as defined by
SEC Regulation G in this press release. A reconciliation of each
non-GAAP financial measure and the comparable GAAP financial
measure can be found in this release.
Gramercy Property Trust
Consolidated Balance Sheets
(Unaudited, dollar amounts in
thousands, except per share data)
December 31,2016
December 31,2015
Assets: Real estate investments, at cost: Land $ 805,264 $
702,557 Building and improvements 4,053,125 3,313,747 Less:
accumulated depreciation (201,525 ) (84,627 )
Total real estate
investments, net 4,656,864 3,931,677 Cash and
cash equivalents 67,529 128,031 Restricted cash 12,904 17,354
Investment in unconsolidated equity investments 101,807 580,000
Assets held for sale, net — 420,485 Tenant and other receivables,
net 72,795 34,234 Acquired lease assets, net of accumulated
amortization of $133,710 and $54,323 618,680 682,174 Other assets
72,948 40,563
Total assets $
5,603,527 $ 5,834,518
Liabilities and Equity: Liabilities: Senior unsecured
revolving credit facility 65,837 296,724 Exchangeable senior notes,
net 108,832 106,581 Mortgage notes payable, net 558,642 530,222
Senior unsecured notes, net 496,464 99,124 Senior unsecured term
loans 1,225,000 1,225,000 Total long-term debt, net
2,454,775 2,257,651 Accounts payable and accrued expenses 58,380
59,808 Dividends payable 53,074 8,980 Below market lease
liabilities, net of accumulated amortization of $26,416 and $17,083
230,183 242,456 Liabilities related to assets held for sale —
291,364 Other liabilities 46,081 52,290
Total
liabilities 2,842,493 2,912,549
Commitments and contingencies Noncontrolling interest in the
Operating Partnership 8,643 10,892
Equity:
Common shares, par value $0.01,
140,647,971 and 140,174,384 issued and outstanding atDecember 31,
2016 and December 31, 2015, respectively
1,406 1,402
Series A cumulative redeemable preferred
shares, par value $0.01, liquidation preference $87,500,and
3,500,000 shares authorized, issued and outstanding at December 31,
2016 and December 31,2015
84,394 84,394 Additional paid-in-capital 3,887,793 3,882,735
Accumulated other comprehensive loss (4,128 ) (5,751 ) Accumulated
deficit (1,216,753 ) (1,051,454 )
Total shareholders' equity
2,752,712 2,911,326 Noncontrolling interest in other
partnerships (321 ) (249 )
Total equity 2,752,391
2,911,077 Total liabilities and equity
$ 5,603,527 $ 5,834,518
Gramercy Property Trust
Consolidated Statements of
Operations
(Unaudited, dollar amounts in
thousands, except per share data)
Three Months EndedDecember
31,
Twelve Months EndedDecember
31,
2016 2015 2016
2015 Revenues Rental revenue $ 95,573 $ 51,996 $
387,032 $ 169,986 Third-party management fees 5,238 4,700 35,766
22,271 Operating expense reimbursements 21,160 12,701 86,878 41,814
Other income 4,231 580 7,588 3,201
Total revenues 126,202 69,977
517,264 237,272 Operating
Expenses Property operating expenses 22,759 13,070 93,123
42,076 Property management expenses 5,196 4,889 20,118 19,446
Depreciation and amortization 59,878 29,120 241,527 97,654 General
and administrative expenses 9,345 5,495 33,237 19,794 Acquisition
and merger-related expenses 3,564 47,832 9,558
61,340
Total operating expenses 100,742
100,406 397,563 240,310
Operating Income (Loss) 25,460 (30,429 ) 119,701 (3,038 )
Other Expenses: Interest expense (18,163 ) (11,438 ) (75,434 )
(34,663 ) Equity in net income (loss) of unconsolidated equity
investments 6,470 (133 ) 2,409 (1,107 )
Gain on dissolution of previously held
U.S. unconsolidated equity investmentinterests
— — 7,229 — Loss on extinguishment of debt — (9,472 ) (20,890 )
(9,472 ) Impairment of real estate investments (10,054 ) —
(11,107 ) —
Income (loss) from continuing operations
before provision for taxes 3,713 (51,472 )
21,908 (48,280 ) Provision for taxes 574
(37 ) (3,160 ) (2,153 )
Income (loss) from continuing
operations 4,287 (51,509 ) 18,748
(50,433 )
Income from discontinued operations before
gain on extinguishment of debt andnet gain on disposals
33 858 3,148 875 Gain on extinguishment of debt — — 1,930 — Net
gain on disposals 321 — 321 —
Income
from discontinued operations 354 858
5,399 875 Income (loss) before
net gain on disposals 4,641 (50,651 ) 24,147 (49,558 )
Gain on sale of European unconsolidated
equity investment interests held witha related party
— — 5,341 — Net gain on disposals 1,541 246 3,877
839
Net income (loss) 6,182
(50,405 ) 33,365 (48,719 ) Net
income (loss) attributable to noncontrolling interest 145
748 (7 ) 791
Net income (loss) attributable to
Gramercy Property Trust 6,327 (49,657 )
33,358 (47,928 ) Preferred share dividends
(1,558 ) (1,558 ) (6,234 ) (6,234 )
Net income (loss) available
to common shareholders $ 4,769 $
(51,215 ) $ 27,124 $
(54,162 ) Basic earnings per share: Net income
(loss) from continuing operations, after preferred dividends $ 0.03
$ (0.71 ) $ 0.15 $ (0.90 ) Net income from discontinued operations
$ — $ 0.01 $ 0.04 $ 0.01
Net income
(loss) available to common shareholders $ 0.03
$ (0.70 ) $ 0.19
$ (0.89 ) Diluted earnings per share:
Net income (loss) from continuing operations, after preferred
dividends $ 0.03 $ (0.71 ) $ 0.15 $ (0.90 ) Net income from
discontinued operations $ — $ 0.01 $ 0.04 $
0.01
Net income (loss) available to common
shareholders $ 0.03 $ (0.70
) $ 0.19 $ (0.89 )
Basic weighted average common shares outstanding
140,298,149 72,879,409
140,192,424 60,698,716 Diluted
weighted average common shares outstanding 141,228,218
72,879,409 141,009,021
60,698,716
Gramercy Property Trust
Reconciliation of Non-GAAP Financial
Measure
(Unaudited, dollar amounts in
thousands, except per share data)
Three Months EndedDecember
31,
Twelve Months EndedDecember
31,
2016 2015 2016
2015 Net income (loss) attributable to common shareholders $
4,769 $ (51,215 ) $ 27,124 $ (54,162 ) Add: Depreciation and
amortization 59,878 29,120 241,527 97,654 FFO adjustments for
unconsolidated equity investments (3,320 ) 1,642 17,485 2,019 Net
income attributable to noncontrolling interest (145 ) (748 ) 7 (791
) Net income from discontinued operations (33 ) (858 ) (5,078 )
(875 ) Impairment of real estate investments 10,054 — 11,107 —
Less: Non real estate depreciation and amortization (223 ) (217 )
(895 ) (870 ) Gain on dissolution of previously held U.S.
unconsolidated equity investment interests — — (7,229 ) — Gain on
sale of European unconsolidated equity investment interests held
with a related party — — (5,341 ) — Net gain on disposals (1,862 )
(246 ) (4,198 ) (839 )
Funds from operations attributable to
common shareholders and unitholders $ 69,118
$ (22,522 ) $ 274,509
$ 42,136 Add: Acquisition costs 3,564
435 9,558 6,395 Core FFO adjustments for unconsolidated equity
investments (632 ) 510 6,797 1,557 Merger related costs — 47,397 —
54,945 Loss on extinguishment of debt — 9,472 18,960 9,472 European
Fund setup costs — — — 221 Net income from discontinued operations
related to properties 266 1,106 5,406 1,106 Mark-to-market on
interest rate swaps1 (52 ) 600 (869 ) 600 Less: Recovery of
servicing advances — — — (1,071 )
Core
funds from operations attributable to common shareholders and
unitholders $ 72,264 $
36,998 $ 314,361 $
115,361 Add: Non-cash share-based compensation
expense 1,652 1,098 5,356 3,829 Amortization of market lease assets
3,562 1,145 14,816 3,777 Amortization of deferred financing costs
and non-cash interest 779 461 565 1,731 Amortization of lease
inducement costs 87 86 346 269 Non-real estate depreciation and
amortization 223 217 895 870 Amortization of free rent received at
property acquisition 1,332 530 2,569 3,415 Less: AFFO adjustments
for unconsolidated equity investments (625 ) 378 727 259
Straight-lined rent (6,464 ) (3,266 ) (25,548 ) (12,206 )
Amortization of market lease liabilities (3,929 ) (3,029 ) (25,515
) (16,026 )
Adjusted funds from operations attributable to
common shareholders and unitholders $ 68,881
$ 34,618 $ 288,572
$ 101,279 Funds from operations per share –
basic $ 0.49 $ (0.30
) $ 1.95 $ 0.68
Funds from operations per share – diluted $
0.49 $ (0.30 ) $
1.93 $ 0.67 Core funds from
operations per share – basic $ 0.51
$ 0.50 $ 2.23 $
1.87 Core funds from operations per share –
diluted $ 0.51 $ 0.50
$ 2.21 $ 1.85 Adjusted
funds from operations per share – basic $ 0.49
$ 0.47 $ 2.05
$ 1.64 Adjusted funds from operations per
share – diluted $ 0.48 $
0.46 $ 2.03 $ 1.62
Basic weighted average common shares outstanding –
EPS 140,298,149 72,879,409 140,192,424 60,698,716 Phantom shares —
136,904 — 136,904 Weighted average non-vested share based payment
awards — 498,672 — 445,610 Weighted average partnership units held
by noncontrolling interest 636,705 491,571 696,662
518,336
Weighted average common shares and units
outstanding 140,934,854 74,006,556
140,889,086 61,799,566 Diluted weighted
average common shares and common share equivalents outstanding –
EPS2 141,228,218 72,879,409 141,009,021 60,698,716 Weighted average
partnership units held by noncontrolling interest 636,705 491,571
696,662 518,336 Weighted average share based payment awards 544,931
960,573 460,172 907,511 Weighted average share options — 12,693 —
17,659 Phantom shares — 136,904 — 136,904 Dilutive effect of
Exchangeable Senior Notes — — — 157,385
Diluted weighted average common shares and units outstanding
142,409,854 74,481,150
142,165,855 62,436,511 1.
For the three and twelve months ended December 31, 2015, the
mark-to-market on interest rate swaps was reclassified from AFFO to
Core FFO and is included in Core FFO for all periods presented.
2. For the three and twelve months ended December 31, 2015,
the Company had a net loss available to common shareholders and
therefore the diluted weighted average share calculation, which is
the denominator in diluted earnings per share, excludes potentially
dilutive securities because they would have been anti-dilutive
during those periods. FFO for the three months ended December 31,
2016 was negative and therefore FFO per share for that period
excludes all potentially dilutive securities.
Disclaimers
Non-GAAP Financial Measures
The Company has used non-GAAP financial measures as defined by
SEC Regulation G in this press release. A reconciliation of each
non-GAAP financial measure and the comparable GAAP financial
measure can be found in this release.
Funds from operations (“FFO”): The revised White Paper on FFO
approved by the Board of Governors of the National Association of
Real Estate Investment Trusts, or NAREIT, defines FFO as net income
(loss) (determined in accordance with GAAP), excluding impairment
write-downs of investments in depreciable real estate and
investments in in-substance real estate investments and sales of
depreciable operating properties, plus real estate-related
depreciation and amortization (excluding amortization of deferred
financing costs), less distributions to noncontrolling interests
and gains/losses from discontinued operations and after adjustments
for unconsolidated partnerships and joint ventures.
Core FFO and adjusted funds from operations (“AFFO”): Core FFO
and AFFO are presented excluding property acquisition costs, loss
on extinguishment of debt, other-than-temporary impairments on
retained bonds, mark-to-market on interest rate swaps, and one-time
charges. AFFO of the Company also excludes non-cash share-based
compensation expense, amortization of above- and below-market
leases, amortization of deferred financing costs, amortization of
lease inducement costs, non-real estate depreciation and
amortization, amortization of free rent received at property
acquisition, straight-line rent, and these AFFO adjustments as they
pertain to the Company's unconsolidated equity investments. The
Company believes that Core FFO and AFFO are useful supplemental
measures regarding the Company’s operating performances as they
provide a more meaningful and consistent comparison of the
Company’s operating performance and allows investors to more easily
compare the Company’s operating results.
FFO, Core FFO and AFFO do not represent cash generated from
operating activities in accordance with GAAP and should not be
considered as alternatives to net income (determined in accordance
with GAAP), as indications of our financial performance, or to cash
flow from operating activities as measures of our liquidity, nor
are they entirely indicative of funds available to fund our cash
needs, including our ability to make cash distributions. Our
calculations of FFO, Core FFO and AFFO may be different from the
calculations used by other companies and, therefore, comparability
may be limited.
Forward-looking Information
This press release contains forward-looking information based
upon the Company's current best judgment and expectations. Actual
results could vary from those presented herein. The risks and
uncertainties associated with forward-looking information in this
release include, but are not limited to, factors that are beyond
the Company's control, including the factors listed in the
Company's Annual Report on Form 10-K, in the Company's Quarterly
Reports on Form 10-Q and in the Company's Current Reports on
Form 8-K. The Company undertakes no obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise. For further information,
please refer to the Company's filings with the Securities and
Exchange Commission.
No Solicitation
This press release shall not constitute an offer to sell or a
solicitation of an offer to buy any of the securities, nor shall
there be any sale of these securities, in any state or jurisdiction
in which such an offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of
any such state or jurisdiction.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170228006934/en/
Gramercy Property TrustJon W. Clark, 888-686-0112Chief Financial
OfficerorAshley M. Mancuso, 888-686-0112Investor Relations
Gramercy Property Trust (NYSE:GPT)
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